Merger Talks: The Story of Three Community Development Corporations in Boston SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Organizational Development
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Merger Talks: The Story of Three Community Development Corporations in Boston
In 2002, a successful community development corporation in Boston, Massachusetts was approached by two other organizations about potential mergers. Each organization had distinctive geographical and ethnic roots but there were clear financial and management advantages to be had from combining assets. In one case, merger discussions proceeded with the benefit of lawyers and common board connections. In the other case, despite good progress at the beginning, the merger talks became increasingly contentious with opposition from community groups who rallied political leadership to step in. This case offers the opportunity to analyze the action and decision-making of the three organizations using alliance, negotiations, organizing and strategic frameworks. It also allows the class to engage in discussion about the nature of "community" in community-based organizations. HKS Case Number 1921.0
Swot Analysis of "Merger Talks: The Story of Three Community Development Corporations in Boston" written by Roy Ahn, Christine W. Letts includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Community Merger facing as an external strategic factors. Some of the topics covered in Merger Talks: The Story of Three Community Development Corporations in Boston case study are - Strategic Management Strategies, Conflict, Demographics, Financial management, Mergers & acquisitions, Negotiations, Strategic planning and Organizational Development.
Some of the macro environment factors that can be used to understand the Merger Talks: The Story of Three Community Development Corporations in Boston casestudy better are - – digital marketing is dominated by two big players Facebook and Google, banking and financial system is disrupted by Bitcoin and other crypto currencies, challanges to central banks by blockchain based private currencies, customer relationship management is fast transforming because of increasing concerns over data privacy, there is increasing trade war between United States & China, increasing government debt because of Covid-19 spendings, increasing household debt because of falling income levels,
increasing energy prices, technology disruption, etc
Introduction to SWOT Analysis of Merger Talks: The Story of Three Community Development Corporations in Boston
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Merger Talks: The Story of Three Community Development Corporations in Boston case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Community Merger, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Community Merger operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Merger Talks: The Story of Three Community Development Corporations in Boston can be done for the following purposes –
1. Strategic planning using facts provided in Merger Talks: The Story of Three Community Development Corporations in Boston case study
2. Improving business portfolio management of Community Merger
3. Assessing feasibility of the new initiative in Organizational Development field.
4. Making a Organizational Development topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Community Merger
Strengths Merger Talks: The Story of Three Community Development Corporations in Boston | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Community Merger in Merger Talks: The Story of Three Community Development Corporations in Boston Harvard Business Review case study are -
Low bargaining power of suppliers
– Suppliers of Community Merger in the sector have low bargaining power. Merger Talks: The Story of Three Community Development Corporations in Boston has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Community Merger to manage not only supply disruptions but also source products at highly competitive prices.
Effective Research and Development (R&D)
– Community Merger has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Merger Talks: The Story of Three Community Development Corporations in Boston - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Superior customer experience
– The customer experience strategy of Community Merger in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
High brand equity
– Community Merger has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Community Merger to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Highly skilled collaborators
– Community Merger has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Merger Talks: The Story of Three Community Development Corporations in Boston HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Analytics focus
– Community Merger is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Roy Ahn, Christine W. Letts can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Cross disciplinary teams
– Horizontal connected teams at the Community Merger are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Successful track record of launching new products
– Community Merger has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Community Merger has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Ability to recruit top talent
– Community Merger is one of the leading recruiters in the industry. Managers in the Merger Talks: The Story of Three Community Development Corporations in Boston are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Ability to lead change in Organizational Development field
– Community Merger is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Community Merger in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Operational resilience
– The operational resilience strategy in the Merger Talks: The Story of Three Community Development Corporations in Boston Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Training and development
– Community Merger has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Merger Talks: The Story of Three Community Development Corporations in Boston Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Weaknesses Merger Talks: The Story of Three Community Development Corporations in Boston | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Merger Talks: The Story of Three Community Development Corporations in Boston are -
High bargaining power of channel partners
– Because of the regulatory requirements, Roy Ahn, Christine W. Letts suggests that, Community Merger is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
Interest costs
– Compare to the competition, Community Merger has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Merger Talks: The Story of Three Community Development Corporations in Boston HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Community Merger has relatively successful track record of launching new products.
High cash cycle compare to competitors
Community Merger has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
No frontier risks strategy
– After analyzing the HBR case study Merger Talks: The Story of Three Community Development Corporations in Boston, it seems that company is thinking about the frontier risks that can impact Organizational Development strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Merger Talks: The Story of Three Community Development Corporations in Boston, is just above the industry average. Community Merger needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Products dominated business model
– Even though Community Merger has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - Merger Talks: The Story of Three Community Development Corporations in Boston should strive to include more intangible value offerings along with its core products and services.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Merger Talks: The Story of Three Community Development Corporations in Boston, in the dynamic environment Community Merger has struggled to respond to the nimble upstart competition. Community Merger has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Increasing silos among functional specialists
– The organizational structure of Community Merger is dominated by functional specialists. It is not different from other players in the Organizational Development segment. Community Merger needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Community Merger to focus more on services rather than just following the product oriented approach.
Capital Spending Reduction
– Even during the low interest decade, Community Merger has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
Aligning sales with marketing
– It come across in the case study Merger Talks: The Story of Three Community Development Corporations in Boston that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Merger Talks: The Story of Three Community Development Corporations in Boston can leverage the sales team experience to cultivate customer relationships as Community Merger is planning to shift buying processes online.
Opportunities Merger Talks: The Story of Three Community Development Corporations in Boston | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Merger Talks: The Story of Three Community Development Corporations in Boston are -
Lowering marketing communication costs
– 5G expansion will open new opportunities for Community Merger in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Organizational Development segment, and it will provide faster access to the consumers.
Low interest rates
– Even though inflation is raising its head in most developed economies, Community Merger can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Buying journey improvements
– Community Merger can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Merger Talks: The Story of Three Community Development Corporations in Boston suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Community Merger is facing challenges because of the dominance of functional experts in the organization. Merger Talks: The Story of Three Community Development Corporations in Boston case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Building a culture of innovation
– managers at Community Merger can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Organizational Development segment.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Community Merger can use these opportunities to build new business models that can help the communities that Community Merger operates in. Secondly it can use opportunities from government spending in Organizational Development sector.
Creating value in data economy
– The success of analytics program of Community Merger has opened avenues for new revenue streams for the organization in the industry. This can help Community Merger to build a more holistic ecosystem as suggested in the Merger Talks: The Story of Three Community Development Corporations in Boston case study. Community Merger can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Organizational Development industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Community Merger can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Community Merger can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Manufacturing automation
– Community Merger can use the latest technology developments to improve its manufacturing and designing process in Organizational Development segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Community Merger can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Leveraging digital technologies
– Community Merger can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Loyalty marketing
– Community Merger has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Community Merger to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Threats Merger Talks: The Story of Three Community Development Corporations in Boston External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Merger Talks: The Story of Three Community Development Corporations in Boston are -
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Community Merger will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
High dependence on third party suppliers
– Community Merger high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Community Merger business can come under increasing regulations regarding data privacy, data security, etc.
Increasing wage structure of Community Merger
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Community Merger.
Stagnating economy with rate increase
– Community Merger can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
Consumer confidence and its impact on Community Merger demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Community Merger in the Organizational Development industry. The Organizational Development industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
Technology acceleration in Forth Industrial Revolution
– Community Merger has witnessed rapid integration of technology during Covid-19 in the Organizational Development industry. As one of the leading players in the industry, Community Merger needs to keep up with the evolution of technology in the Organizational Development sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Merger Talks: The Story of Three Community Development Corporations in Boston, Community Merger may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Organizational Development .
Environmental challenges
– Community Merger needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Community Merger can take advantage of this fund but it will also bring new competitors in the Organizational Development industry.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Community Merger in the Organizational Development sector and impact the bottomline of the organization.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Shortening product life cycle
– it is one of the major threat that Community Merger is facing in Organizational Development sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of Merger Talks: The Story of Three Community Development Corporations in Boston Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Merger Talks: The Story of Three Community Development Corporations in Boston needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Merger Talks: The Story of Three Community Development Corporations in Boston is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Merger Talks: The Story of Three Community Development Corporations in Boston is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Merger Talks: The Story of Three Community Development Corporations in Boston is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Community Merger needs to make to build a sustainable competitive advantage.
